With housing prices and the cost of living continuing to rise, homeowners are looking for ways to protect their valuable investments. Enter the home warranty – a service that covers repairs and replacements for a home’s major systems and appliances that fail due to normal wear and tear.
In today’s complex homes filled with HVAC systems, electrical panels, and high-tech appliances, repairs can be unpredictably expensive. With environmental changes causing homes to work harder than ever, unexpected breakdowns are becoming more common. This makes 2024 an important year to consider a home warranty.
What is a Home Warranty?
A home warranty is a one-year service contract that helps budget for repairs on covered parts of major home systems, like air conditioning units, furnaces, plumbing pipes, and water heaters. Appliances like refrigerators, ovens, and washers and dryers are also commonly covered.
Unlike homeowners insurance, which protects against damage from external events like fires or storms, a home warranty covers repairs needed from the normal operation of home systems. For example, if an air conditioner unit stops working because it’s reached the end of its normal lifespan, a home warranty would pay for the replacement. However, damage from a lightning strike would require a homeowners insurance claim.
Think of a home warranty as prepaid protection against expensive home system breakdowns. For a monthly fee, you get a safety net of coverage for when covered items need service.
Why Home Warranties Offer More Peace of Mind Than Ever in 2024
Advancements in home technologies and shifts in climate patterns are two trends making home warranties an especially prudent investment in the current market:
- Smart home tech grows more complex – and costly: With smart home devices growing exponentially, homes now run complex networks of integrated systems that control temperature, lighting, entertainment, security alarms and more. High-tech homes promise exciting capabilities but also come loaded with potential points of failure. Specialized technicians are often required for repairs. One smart home system failure could lead to thousands in repair bills – but a good home warranty would cover it.
- Environmental strains hit home systems harder: Climate change causes weather fluctuations like more intense heat waves and polar vortex cold snaps. These put more stress on home systems, increasing wear and tear. Parts like HVAC components degrade faster, while pipes grow more susceptible to freezing and cracks. Home warranties mitigate the financial downsides of withstanding mother nature by paying for covered repairs.
Technical complexity and environmental strains are raising the stakes on home ownership. Home warranties help balance out these emerging risks cost-effectively.
Home Warranties Can Make or Save Real Estate Transactions
When buying or selling a home, a home warranty can make the difference between a smooth transaction or a frustrating, costly process.
For home buyers, an included home warranty offers assurance that they can budget for covered repairs on existing equipment. Rather than fearing huge impending bills to replace an aging water heater or AC unit, the warranty absorbs covered costs. This provides peace of mind in the unpredictable early days of ownership.
Meanwhile, home sellers can include a home warranty to make their listing more attractive. 89% of realtors agree that home warranties help sell homes faster and at a higher price. Why? Because warranties telegraph confidence about the quality and condition of home systems. If serious issues existed, the seller likely wouldn’t voluntarily take on the warranty coverage. When sellers add a home warranty to sweeten the deal, buyers may offer over asking price more often.
Choosing the Right Home Warranty
With so many providers on the market, it’s important to understand what to look for in home warranty coverage. As you evaluate plans and get quotes, keep the following guidance in mind:
- Coverage Scope: Look for comprehensive coverage across all major home systems – HVAC, plumbing, electrical, appliances, pools/spas etc. See whether additional coverage is available for standalone items like well pumps or ceiling fans for a few extra dollars per month.
- Service Fees: Most plans charge a service fee per repair, ranging from $50 to $150. Some offer a lower or no service fee option at a higher monthly cost. Also check if you must pay the full fee for follow-up visits.
- Coverage Limits: Pay attention to dollar limits per repair and annual caps across repairs. Higher limits ensure adequate coverage for repairs like AC unit replacements. Also confirm if limits refresh annually or are fixed for the policy term.
- Exclusions & Limitations: Common exclusions are normal maintenance, pre-existing conditions, environmental damages (flood, earthquake, etc), and home additions/upgrades. Understand these to avoid surprise uncovered expenses later.
- Reputation & Credentials: Choose an established national brand with expertise handling claims across many states. Look for customer service ratings and reviews on factors like response time, repair quality and claims approval rates.
Who Needs a Home Warranty in 2024?
In today’s housing market, most homeowners can benefit from home warranty protections against unpredictable and expensive equipment failures:
- New Home Buyers: Warranties let first-time buyers afford essential repairs as they furnish their home on a budget
- Settled Homeowners: Warranties help budget for replacement costs as home systems age beyond expected useful lifespans
- Tech-Savvy Households: Warranties protect smart homes against failures of integrated systems and devices
- Sellers and Landlords: Warranties raise property value and rentability while conveying quality, attracting buyers/tenants
With repair costs spiraling and home technologies growing more complex than ever, 2024 is poised to be the year that home warranties become simply part of responsible home ownership. Don’t wait for disaster to strike – make sure your valuable investment is protected.
Frequently Asked Questions About Home Warranty
Do brand new homes need warranties too?
Yes – even modern appliances and systems in new constructions can fail prematurely at times. Though less prone to immediate issues, new homes benefit from warranty coverage as a safeguard against unexpected defects or failures of installed equipment.
How does the claims process for a home warranty work?
When a covered item failure occurs, you simply call your warranty company to file a claim. After paying your service fee, the company dispatches its network of screened, licensed repair professionals to diagnose the issue. If the item cannot be fixed, your warranty covers the replacement parts and labor per your contract terms.
What are some items typically excluded from home warranty coverage?
Most warranties exclude normal maintenance, pre-existing conditions from before the policy term, damages from natural disasters or home modifications, and items still under manufacturer’s warranty. Structural elements like walls, floors and roofs are also generally excluded.
Can I get a home warranty policy even if I’m not buying or selling my home soon?
Yes, you can enroll in a home warranty independently any time for regular protection against covered system and appliance breakdowns. Unlike warranties bundled with home sales, you’d simply contact and pay an independent home warranty provider directly.
How can a home warranty benefit home sellers specifically?
Offering a warranty can make sellers more attractive to buyers by signaling confidence in the home’s condition. This translates to higher bid prices and faster sales. One survey found 89% of realtors say home warranties help sell houses quicker and for more money.
Get Started with Home Warranty Protection
Home warranties offer critical financial protection against expensive home system and appliance breakdowns. They bring peace of mind to homeowners and real estate investors alike in 2024’s challenging housing environment.
Ready to secure coverage for one of your biggest personal investments? The home professionals at Realoq have relationships with top-rated home warranty companies across the country.
Contact a Realoq real estate agent today for a referral to reputable home warranty providers that serve your area. Their team is happy to answer all your questions and concerns about plans and pricing. They can also advise if bundling a home warranty would help you attract buyers and sell your home faster.
With housing markets fluctuating and climate challenges continuing, take control of your home ownership experience in 2024. Contact a Realoq agent to explore your home warranty options!
